Posts tagged ‘methanol’

The expected startup of new methanol capacity during the second half of the year is prompting a bearish outlook for some market participants heading into the third quarter.

US capacity is set to hit 7.5 million/mt with the startup of a 1.75 million mt/year methanol plant in Beaumont, Texas. The OCI Natgasoline venture, owned jointly by OCI and G2X Energy, was slated to begin production in the July-August period, but sources have suggested startup may not happen until late Q4.

The US is experiencing a renaissance in petrochemicals due to the abundance of ethane from shale gas. As a result, we saw many announcements of ethylene capacity expansions and ethane based projects in the US to utilize more of the shale gas based ethane. Why? Ethane based crackers sit low on the ethylene production cost curve.

So what do you do if you are a naphtha cracker high on the cost curve producing in Europe and Asia?

The dramatic drop in crude prices over the past year has sent shock waves throughout global markets. Petrochemical markets have also been touched, in some instances in a positive manner, as cheaper crude translates into lower feedstock cost. This analysis looks at a specific sector of the petrochemical market — coal-to-olefins and methanol-to-olefins production — and evaluates how the changing relationship between coal and crude prices is impacting production economics in the largest growing petrochemical market in the world, China.

Shell’s recent decision to abandon plans for a massively expensive gas-to-liquids project in the US Gulf Coast serves to further illustrate the complicated conundrum many petrochemical companies are faced with these days: to build or not to build.

And yet, as 2013 comes to a close, the North American petrochemical industry remains rather bullish on shale gas.

The $100 billion investment figure gets thrown around with wild abandon. Everyone wants to cash in on cheap feedstocks…still. Not one company has abandoned a major petrochemical project, at least not publicly. › Continue Reading